REIT exchange-traded funds are leading other equity categories on the S&P 500 by a healthy margin, according to Timothy Strauts, an analyst for Morningstar. The category "U.S. ETF Real Estate" was up 22% for the year ending Sept. 21 vs. 3.71% for the S&P 500 stock index. Their recovery is in some part due to the fact the worst-case scenario for commercial real estate never materialized during the recession, says Mark Ward, chairman of the Investment Policy Committee at Lucien, Stirling & Gray Advisory Group. "Now that it is clear that while things are still tough all over, the worst-case scenario has yet to pan out, causing the markets to bid the prices on securities and REITs back to more reasonable levels," he said.

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